What if I was to tell you that you can strengthen your company from the inside, by helping on the outside? That you can grow your company by giving to others? Or that you can enhance your brand image by utilizing your employees as ambassadors?
Do I have your attention? Read on and I’ll explain how you can do all of the things above by integrating a strategy for social good into your business strategy.
Embracing charitable giving and broader corporate social responsibility (CSR) initiatives has many benefits, including financial ones. Let’s begin with your workforce. Studies show that employees want to feel like they are making a difference and contributing to more than their company’s bottom line. In fact, they expect their employers to provide them with opportunities to do so. Encouraging participation in company-sponsored fundraisers, volunteerism, and charity events drives employee engagement.
You may have heard engagement defined as how “happy” or “satisfied” employees are. In fact, there is a distinct difference between satisfied employees and engaged employees. Satisfied employees like their jobs and are happy to come to work. They do what is required of them, and they perform their job functions well.
Engaged employees go a step further. They bring a passion and a higher level of commitment to their job. They have a sense of purpose, strive to achieve more, and are fully invested in their company’s success. Engaged employees are a company’s biggest asset, and through their participation in a CSR program, they will serve as ambassadors of not only the culture, but also the company’s image and brand.
Workplace giving and CSR programs, when incorporated into a company’s business strategy, help to strengthen an employee’s commitment and increase the emotional investment employees make in the company. If you go a step further and give them a voice by inviting them to offer ideas and feedback about your program on a regular basis, you are also empowering them. Engagement and empowerment contribute to higher performance, which in turn leads to higher productivity.
All of this can have a direct impact on core strategy execution and the overall success of a business. Engaged employees are less likely to leave a company, especially one that they feel is committed to making the world a better place. Research indicates that companies who encourage employees to volunteer have higher retention rates. Higher retention rates have a positive impact on a company’s bottom line because they reduce the amount of money spent on recruiting and hiring, not to mention training new employees due to turnover.
Socially responsible companies also gain the trust and loyalty of consumers, as is evidenced in Nielsen’s Annual Global Corporate Sustainability Report. The report found that 66% of consumers said they’d be willing to spend more money on products from a brand that they view as being sustainable. Another report from Cone Communications revealed that a whopping 90% of consumers said they’d switch brands for one that supports a cause.
Millennials make up the largest demographic of consumers who value sustainable companies. According to the Nielsen report, 81% of millennials said that they favor companies with strong values and a commitment to corporate citizenship. Considering the fact that this group will make up roughly half of the workforce by 2020, companies that hope to attract top millennial talent will need to have a solid CSR strategy in place.
It’s easy to see, with all this supporting data, why the C-suite is becoming more involved in CSR initiatives. If you’re a CFO and your company doesn’t have a charitable giving or a CSR program, you may soon find yourself in the minority. More and more executives are embracing CSR initiatives. The reason could be the mounting evidence pointing to the financial benefits that companies with CSR programs reap.
Accenture’s January 2015 report “Beyond Supply Chains – Empowering Responsible Value Chains” focused on consumer goods supply chains and found that companies with CSR strategies enjoyed the following:
- 5%-20% revenue increases
- 9%-16% supply chain cost reduction
- 15%-30% brand value increase
- 13%-22% carbon emission reductions
Numbers like these would make any CFO smile; and they’re likely the reason why 65% of CFOs in corporations with more than $1 billion in revenue are actively involved in their companies CSR programs, according to an Ernst & Young/Green Biz survey.
Finally, incorporating a strategy for social good into a business strategy, whether it be through charitable giving, volunteerism, or other CSR initiatives, helps build trust with employees. By playing an active role in community service projects, executives send a message that they “walk the walk” to their employees and other stakeholders.
Being able to say that you’ve worked side by side with an executive on a volunteer project can be a big morale boost for any employee. For the C-suite, it provides an opportunity to connect with employees that are not in their reporting line and to get to know them on a personal level.
In general, CSR projects provide all employees with the opportunity to engage with people they otherwise might not get a chance to speak with or work with during the course of their workday. They create connections between people, which in turn fosters teamwork. Relationships are forged and strengthened, camaraderie ensues, and the community benefits. Everybody wins.
Alessandra Cavalluzzi is speaking at the FP&A Innovation Summit on September 12-13 in Boston. She is the author of A Million Dollars in Change: How to Engage Your Employees, Attract Top Talent, and Make the World a Better Place (Wise Ink, Spring 2018). She has more than a decade of experience in human resource management, corporate social responsibility, corporate communications, and employee engagement.